Iraq: No breakthrough seen in Maliki visit to Kurds

ERBIL, Iraq, June 12 (UPI) -- Prime Minister Nouri al-Maliki's weekend visit to Iraq's semiautonomous Kurdish enclave did not produce any visible sign of a breakthrough in Baghdad's feud with the independence-minded Kurds who're now exporting oil through neighboring Turkey.

It was Maliki's first trip to the Kurdish capital, Erbil, in more than two years.

That reflects both the magnitude of the divisions between the Kurds and Iraq's central government over oil and land, and the prime minister's growing sense of desperation as Iraq's engulfed once again in sectarian bloodletting many fear could lead to the disintegration of the federal state.

If the beleaguered Maliki, a Shiite aligned with Iran, can patch things up with the Kurds, who waged a decades-long separatist war against Saddam Hussein and have pretty much run their own affairs and armed forces since 1992, it would allow him to concentrate on countering the swelling violence by Iraq's disgruntled Sunni minority.

The rift with the Kurds, who're developing their own energy industry separate from the Iraqi state's, and the growing violence are both harming Maliki's ambitious plans for a large-scale boost in Iraqi oil production to bankroll national reconstruction.

Sunday's talks in Erbil between Maliki and Masoud Barzani, president of the Kurdistan Regional Government, may have broken the ice, but political sources said little of substance emerged that would indicate some kind of settlement is possible.

Maliki is incensed that the Kurds are now shipping their oil northward to Turkey's export terminal on the Mediterranean, rather than through the Oil Ministry's pipeline network, cutting Baghdad out of the revenue loop.

The Kurdish exports are being trucked across Turkey, but Ankara and Erbil are building a new pipeline from Kurdistan to the Mediterranean that's expected to be completed within the next few months. That would allow the landlocked Kurds to export 250,000 barrels per day by the end of 2013, 1 million bpd by 2015 and 2 million bpd by 2019.

"Large-scale oil exports would change the economic position of Kurdistan," explained Robin Mills of Manaar Energy Consulting and Project management in the United Arab Emirates.

The Kurdish exports also bolster Turkish Prime Minister Recep Tayyip Erdogan's plan to transform his energy-poor country into a regional energy hub and further his ambitions to restore Turkey as a major regional power.

Turkey's state oil company, TPAO, is already operating in Iraqi Kurdistan, which has played a key role in Erdogan's drive to end a 3-decade-old separatist war by Turkey's own Kurdish minority, a vital prerequisite in Ankara's game plan for regional authority.

This has meant Ankara's had to completely reverse its long-held policy of opposing Kurdish autonomy in Iraq, underlining just how significant a shift there's been in Turkey's strategic outlook, and how Ankara's relations with Baghdad have been downgraded in importance over the last couple of years.

In a bold move, Erdogan announced May 15 that TPAO was joining up with ExxonMobil Corp. of the United States to develop oil fields in Iraqi Kurdistan, a resounding slap in the face for Maliki's troubled coalition government.

Exxon infuriated Baghdad in October 2011 when, frustrated by Iraqi restrictions and delays, signed an exploration deal with the KRG, sacrificing its participation in an international consortium developing the $50 billion West Qurna 1 megafield in southern Iraq.

That encouraged the Chevron of the United States, Total of France and Gazprom Neft of Russia to move into Kurdistan too, seriously undermining Baghdad's energy strategy while encouraging Kurdish aspirations of eventual statehood.

The Kurds are also at odds with Baghdad over the Kirkuk oil fields in northern Iraq. That dispute seems to be as intractable as Maliki's feud with Erbil over the KRG's oil reserves, estimated 45 billion barrels. That's about one-third of Iraq's overall reserves, upgraded in May to 150 billion barrels.

The Kurds claim the ethnically mixed city of Kirkuk and its oil fields were part of their territory during 400 years of Ottoman rule. But Kirkuk contains another one-third of Iraq's oil, and Maliki can never surrender that to the Kurds without risking political suicide.

Thousands of Iraqi and Kurdish troops are locked in an armed confrontation over Kirkuk and it wouldn't take much to trigger conflict.

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